Joe's Tire Company has two support departments, Personnel and Maintenance. The Maintenance Department cos of $80,000 are allocated on the basis of standard service hours used. The Personnel Department costs of $20,000 are allocated based on the number of employees. Costs of Departments A and B are $40,000 and $60,000, respectively. Data on standard service hours and number of employees are as follows. How much of the cost of the Personnel Department is allocated to Department B using the direct method? Round to the nearest dollar. Personnel Department 200 Standard service hours used Number of employees O A. $8,000 O B. $60,000 O C. $12,632 O D. $5,000 Ⓒ E. $15,000 Maintenance Department 200 10 20 Production Department A 240 40 Production Department B 160 120

Joe's Tire Company has two support departments, Personnel and Maintenance. The Maintenance Department cos of $80,000 are allocated on the basis of standard service hours used. The Personnel Department costs of $20,000 are allocated based on the number of employees. Costs of Departments A and B are $40,000 and $60,000, respectively. Data on standard service hours and number of employees are as follows. How much of the cost of the Personnel Department is allocated to Department B using the direct method? Round to the nearest dollar. Personnel Department 200 Standard service hours used Number of employees O A. $8,000 O B. $60,000 O C. $12,632 O D. $5,000 Ⓒ E. $15,000 Maintenance Department 200 10 20 Production Department A 240 40 Production Department B 160 120

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Utease Corporation has several production plants nationwide. A newly opened plant in Dubuque produces and sells one product. The plant is treated, for responsibility accounting purposes, as a profit center. The unit standard costs for a production unit, with overhead applied based on direct labor hours, are as follows. Manufacturing costs (per unit based on expected activity of 20,000 units or 44,000 direct labor hours): Direct materials (2.7 pounds at $20) $ 54.00 Direct labor (2.2 hours at $80) 176.00 Variable overhead (2.2 hours at $30) 66.00 Fixed overhead (2.2 hours at $40) 88.00 Standard cost per unit $ 384.00 Budgeted selling and administrative costs: Variable $ 4 per unit Fixed $ 1,800,000 Expected sales activity: 18,000 units at $500 per unit Desired ending inventories: 12% of sales Assume this is the first year of operations for the Dubuque plant. During the year, the company had the following…
Carter Company manufactures two products, Deluxe and Regular, and uses a traditional two-stage cost allocation system. The first stage assigns all factory overhead costs to two production departments, A and B. based on machine hours. The second stage uses direct labor hours to allocate overhead to individual products. For the current year, the firm budgeted $1,550,000 total factory overhead cost. The $1,550,000 was for the planned levels of machine and direct labor hours shown in the following table. Machine hours Direct labor hours Units produced and sold Unit cost of direct materials The following information relates to the firm's operations for the month of January: Hourly direct labor wage rate Direct labor hours in Department A per unit Direct labor hours in Department B per unit Activity Material movement Machine setups Inspections Shipment Production Production Department A Department B 6,200 31,000 1. Deluxe unit cost Regular unit cost 2. Deluxe unit overhead Regular unit…
Godiva company has two products, A and B. The company uses activity-based costing to allocate overhead costs of $100,000. Data relating to the company's activity pools for the current year are given below: Cost Pool Total cost in Total Number of Activity Measures Used Cost Pool Product A Product B Total Activity 1 $42,000 100 200 300 Activity 2 $10,000 20 5 25 Activity 3 $48,000 3,000 3,000 6,000 Compute the activity rate (allocation rate) for Activity 2: $500 $2,000 $400 $140
Vishnu
Utease Corporation has several production plants nationwide. A newly opened plant in Dubuque produces and sells one product. The plant is treated, for responsibility accounting purposes, as a profit center. The unit standard costs for a production unit, with overhead applied based on direct labor hours, are as follows. Manufacturing costs (per unit based on expected activity of 20,000 units or 44,000 direct labor hours): Direct materials (2.7 pounds at $20) $ 54.00 Direct labor (2.2 hours at $80) 176.00 Variable overhead (2.2 hours at $30) 66.00 Fixed overhead (2.2 hours at $40) 88.00 Standard cost per unit $ 384.00 Budgeted selling and administrative costs: Variable $ 4 per unit Fixed $ 1,800,000 Expected sales activity: 18,000 units at $500 per unit Desired ending inventories: 12% of sales Assume this is the first year of operations for the Dubuque plant. During the year, the company had the following…
Utease Corporation has several production plants nationwide. A newly opened plant in Dubuque produces and sells one product. The plant is treated, for responsibility accounting purposes, as a profit center. The unit standard costs for a production unit, with overhead applied based on direct labor hours, are as follows. Manufacturing costs (per unit based on expected activity of 31,000 units or 52,700 direct labor hours): Direct materials (2.5 pounds at $18) $ 45.00 Direct labor (1.7 hours at $70) 119.00 Variable overhead (1.7 hours at $20) 34.00 Fixed overhead (1.7 hours at $30) 51.00 Standard cost per unit $ 249.00 Budgeted selling and administrative costs: Variable $ 8 per unit Fixed $ 1,600,000 Expected sales activity: 27,000 units at $380 per unit Desired ending inventories: 18% of sales Assume this is the first year of operations for the Dubuque plant. During the year, the company had the following…
Utease Corporation has several production plants nationwide. A newly opened plant in Dubuque produces and sells one product. The plant is treated, for responsibility accounting purposes, as a profit center. The unit standard costs for a production unit, with overhead applied based on direct labor hours, are as follows. Manufacturing costs (per unit based on expected activity of 20,000 units or 44,000 direct labor hours): Direct materials (2.7 pounds at $20) $ 54.00 Direct labor (2.2 hours at $80) 176.00 Variable overhead (2.2 hours at $30) 66.00 Fixed overhead (2.2 hours at $40) 88.00 Standard cost per unit $ 384.00 Budgeted selling and administrative costs: Variable $ 4 per unit Fixed $ 1,800,000 Expected sales activity: 18,000 units at $500 per unit Desired ending inventories: 12% of sales Assume this is the first year of operations for the Dubuque plant. During the year, the company had the following…
Mervon Company has two operating departments: Mixing and Bottling. Mixing occupies 28,795 square feet. Bottling occupies 15,505 square feet. Indirect factory costs include maintenance costs of $208,000. If maintenance costs are allocated to operating departments based on square footage occupied, determine the amount of maintenance costs allocated to each operating department.
alland Manufacturing Company makes two different products, M and N. The company's two departments are named after the products; for example, Product M is made in Department M. Yalland's accountant has identified the following annual costs associated with these two products: Financial data Salary of vice president of production division ................. $160,000 Salary of supervisor Department M .............................. 80,000 Salary Yalland Manufacturing Company makes two different products, M and N. The company's two departments are named after the products; for example, Product M is made in Department M. Yalland's accountant has identified the following annual costs associated with these two products:Financial dataSalary of vice president of production division ................. $160,000Salary of supervisor Department M .............................. 80,000Salary of supervisor Department N ................................. 60,000Direct materials cost Department M…
Klamath Corp. produces two products: saws and drills. Three activities are used in their manufacture. These activities and their associated costs and bases are as follows: Activity Stamping Assembly Setup Activity Base Machine hours Labor hours Number of setups Units produced Budgeted Costs Saws Drills $200,000 400,000 30,000 Saws 4,000 7,000 $ 3 500 Activity Base Machine hours Labor hours Number of setups a. Determine the activity rate for each activity. Stamping Assembly Setup Drills 6,000 13,000 12 600 per machine hour per labor hour per setup b. Determine the factory overhead to be allocated to each unit of product. Round your answers to two decimal places, if necessary. per unit per unit Total 10,000 20,000 15 Previous
Solomons, Inc. has refined its allocation system by separating manufacturing overhead into two cost pools, one for each department. The estimated cost for the mixing department, $615,000, will be allocated based on direct labor hours, and the estimated direct labor hours for the year are 201,000. The estimated cost for the packaging department, $293,000, will be allocated based on direct labor hours, and the estimated machine hours for the year are 59,200. In October, the company incurred 17,240 direct labor hours in the mixing department and a total of 14,260 machine hours in the packaging department.(Round your answers to two decimal places when needed and use rounded answers for all future calculations).1. Compute the predetermined overhead allocation rates. Department Total estimated overhead cost ? Total estimated quantity of the overhead allocation base = Predetermined Overhead Allocation Rate (Per Machine Hour) Mixing Department = Packaging Department =…
Mervon Company has two operating departments: mixing and bottling. Mixing occupies 26,640 square feet. Bottling occupies 17,760 square feet. Indirect factory costs include maintenance costs of $210,000. If the maintenance costs are allocated to operating departments based on square footage occupied, determine the amount of maintenance costs allocated to each operating department. Department Mixing Bottling Total Sq. Feet % of Total Maint. Exp. to Allocate Allocated Amount